A nationally representative sample of around 350 Georgians, interviewed in early May, reveals that Georgian Consumer Confidence rose in May compared to the prior month, by 8.1 index points, from -48.3 in April to -40.2 in May. This follows rapid declines in the index in March and April. The increase in Consumer Confidence was driven by the expectations index, particularly consumers are positive about general economic situation and their ability to save, for the next twelve months. Therefore, not surprisingly, Expectations Index registered an increase by 17.2 index points, from -51.2 in April to -34 in May. While, the other index that measures how Georgians feel about the economy right now, the Present Situation Index, went down by 1.1 index points, from -45.3 in April to -46.5 in May. The latter negative change occurred, as consumers remain concerned about their financial prospects and general economic situation at present.
May 2020 | Georgian Consumer Confidence: Revival in May
Based on the questions asked during the interviews, below we present Table 1 that shows which particular questions (also mentioned in the above section) caused the increase in Georgian Consumer Confidence in May 2020.
Table 1: May 2020, Changes in Consumer Confidence (Index Points), by Questions
How will your financial situation change over the next 12 months?
Do you expect to increase spending on major purchases compared to the past, over the next 12 months?
Your ability to save over the next 12 months
General economic situation over the next 12 months
Do you expect prices to increase more rapidly over the next 12 months?
Expected level of unemployment in Georgia, next 12 months
How did the general economic situation changed in Georgia over the past 12 months?
How much did consumer prices rise over the past 12 months?
Is now the right time for people to make major purchases in Georgia?
Is now the right time for people to save in Georgia?
Your current ability to save?
Your financial situation over the past 12 months
Note: Underlined questions stand for present situation
As was anticipated and confirmed after the interviews, in April consumers were not positive and happy with respect to their consumer confidence and to find out more regarding the pessimism of Georgian consumers, we asked a few questions in addition to the regular CCI questions. In May interviews, consumers again were asked additional questions with the same purpose of getting more clues about their level of pessimism and confidence. In particular, we asked: “Did you lose a job or a source of income because of the nationwide quarantine? ”, “Do you expect you will get your job/source of income back once the nationwide quarantine ends (currently on May 22nd)”, “Does your household have enough resources to live on under a strict quarantine announced by the government until May 22nd? ”, “What was your source of income?”.
Results are presented below.
Table 2: Current employment state and expectations about the future state of employment
Do you expect you will get your job/source of income back once the nationwide quarantine ends (currently on May 22nd)
Did you lose a job or a source of income because of the nationwide quarantine?
will fully get back
will partially get back
cannot get back
do not know
Table 2 presents data on the current employment state of interviewed Georgians and what expectations they have in the near future regarding employment. Among those people who completely lost their jobs, only 17% indicated they cannot recover their jobs; 25% and 39% believed they would fully and partially return to their jobs, respectively; and 19% had uncertainty in this regard. Similarly, among those people who partially lost their jobs, around 70% believe that they will get their jobs back completely or partially. Although our data does not allow us to specify in which particular employment sectors people cannot get back their jobs or will be able to partially return to, people who currently are unemployed or partially unemployed definitely contributed to the decline in the Present Situation Index figures.
Table 3: Sources of income and financial viability under a strict quarantine announced by the government until May 22nd
What was your source of income?
Does your household have enough resources to live on under a strict quarantine announced by the government until May 22nd?
do not know
Table 3 gives insights about the income sources of people before the lockdown and whether they would have enough financial resources to survive before the economy reopens. Notably, among people whose families currently have enough resources to live on without financial assistance, salary and self-employment were the main sources of income, 58% and 33% respectively. Among those who will not have enough resources to live on before economy starts to operate again, salary and self-employment are again one of the main income sources. However, some people (26%) also depend on the remittances, which makes them also vulnerable with respect to foreign economies. Overall, 21% of survey respondents indicated they will not have enough resources to live on before the economy reopens. While only 5% do not know the answer.